IFA locking me in to ongoing fees

Marcon

fred246 wrote: »

The firm will say to the IFA "Don't worry, you're doing a good job. It is important to make sure that you try to lock every customer into an ongoing fee arrangement. You will get difficult customers from time to time."

It's what the firm says to the customer that matters - after all, that could be what the Financial Ombudsman sees if the customer is seriously unhappy.

Brynsam

fred246 wrote: »

The firm will say to the IFA "Don't worry, you're doing a good job. It is important to make sure that you try to lock every customer into an ongoing fee arrangement. You will get difficult customers from time to time."

You'll also find they need to follow the rule book.

Albermarle

Unless your finances are considerably complex, then £10,000 to transfer a DC pension pot to a SIPP is insane. IMHO

The original quote of £2600 is in the region I have heard before for consolidating multiple pensions into a SIPP and setting up a suitable investment portfolio in the SIPP , but without any direct link to having an ongoing service which should be a separate issue.

Personally I wouldn't even pay £2600 , as I have transferred three pensions myself ( in cash ) and each took about 15 minutes without issues .They all completed within two weeks . OK you have to then pick your investments, which is more tricky , depending on your knowledge level .

[Deleted User]

He is refusing to do the job for pre-agreed price. Run away from the IFA. You don’t owe him a penny. I wouldn’t trust him with one either.

segovia

Update, and it does not get any better. I spoke to the SIPP Provider this morning, and they have confirmed the following

Talbot and Muir SIPP client’s should have access to ongoing regulated advice. Our policy states;

· New money into a new investment – Requires advice
· New money topping up existing investment – Requires advice
· Encashment of an investment – Requires advice

I am effectively locked into an agreement with the IFA or another IFA if I proceed with the recommended SIPP. This is contrary to the assurance given to me by the IFA that I am NOT locked into anything.

I am really feeling p-ssed off now, do I have a case to reject his advice and refuse to pay the fees on the basis that he has not been entirely transparent ?

JoeCrystal

segovia wrote: »

I am really feeling p-ssed off now, do I have a case to reject his advice and refuse to pay the fees on the basis that he has not been entirely transparent ?

I thought you haven't got any advice sorted. Just confirm that you would not be hiring the IFA and walk away from this unless you agreed to pay the fees for the advice.

HappyHarry

Surely you just tell the IFA you don't want an ongoing service, and the IFA will then provide a suitable recommendation that doesn't require an ongoing service? You, as a client, are quite entitled to ask for such advice, especially given the quote from the IFA that the ongoing fee is entirely discretionary.

If the IFA has set their charging model based on needing on-going fees, then really they ought to make this clear beforehand, and they ought to re-think how they take-on new clients.

Personally, I think £2,600 initial fee for advising on a £400,000 investment is cheap, but not drastically so. If the IFA has any sense, they will now recommend a simple single-fund multi-asset solution to you, which you can take-up and then amend at your leisure at a later date.

You can then wash your hands of the IFA, and vice-versa.

jonnygee2

He now says it greatly compromises his charging model and he can't do the transfer without me agreeing to the ongoing charges. I suspect he will still want to be paid for the work done so far which includes the transfer.

Bit confused here - has the transfer been made or not?

segovia

JoeCrystal wrote: »

I thought you haven't got any advice sorted. Just confirm that you would not be hiring the IFA and walk away from this unless you agreed to pay the fees for the advice.

A brief summary of the fees and the proposal was sent to me first and regrettably, I agreed to pay the fees for the advice that followed. It's only when I have reviewed the full proposal document and asked questions that I became uncomfortable with what is being proposed.

J

segovia

jonnygee2 wrote: »

Bit confused here - has the transfer been made or not?

No transfer has been made yet we have reached a hiatus.

Initially, I agreed to the advice and transfer fee and the ongoing of 0.6% as I was under the impression that he would be actively managing my investments. However, it is going into a discretionary managed fund which I wasn't familiar with. My rationale for subsequently declining the ongoing was based on two factors.

1, As its DMF I don't think I need ongoing advice
2, I don't believe I need any further financial advice until I get to drawdown in 4 or 5 years time.

He refuses to process the transfer as it "comprises his pricing model" even though I have two separate emails from him saying ongoing fees are entirely discretionary.

J